How do calculate the present value of the bond

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Problem 1. Before beginning her college studies, Rita Rivera's parents deposited $ 15,000 in a 5-year certificate of deposit (CD) with Liberty Bank that pays 4% interest. Rita will receive the money, plus interest, if she finishes her high school at the end of the 5 years. Determine the balance in Rita's account after 5 years.

Problem 2. Suppose a Puerto Rico government bond pays $ 3,255.80 within 4 years at 4% interest. Calculate the present value of the bond. Determine the value of the bond assuming it will mature in 6 years at 5% interest.

Problem 3. Determine the present value of $ 2,500,000 that will be paid after 25 years if the discount rate is 7

Reference no: EM132965981

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